Apple Acquired Nuance? Five Reasons Why It's Probably Not True

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Rumors are swirling this morning about voice technology giant Nuance Communications being acquired by Apple, following remarks made by the company’s co-founder Steve Wozniak in a short video interview by TVDeck (see below, skip to the 0:40 mark). While the acquisition would make sense for Apple to make on a strategic level, there are a couple of reasons why it’s most likely not true.

First off, Wozniak probably meant Siri, the “personal assistant” Apple confirmed to have acquired back in April. Siri, a spin-out from Stanford Research Institute, uses speech recognition technology from Nuance for its voice-activated search capabilities, which may have been the root of Wozniak’s confusion. Nuance just this morning announced that it’s also powering voice search for IAC-owned Ask.com’s iPhone app.

Secondly, Nuance just released its Q4 2010 earnings yesterday, and made no mention of being (in the process of getting) bought by Apple. You would think they’d at least tell shareholders that if it were the case.

Third, the earnings press release does mention that Nuance considers Apple to be one of its “key mobile customers”, along with the likes of Amazon, AT&T, Nokia, Palm and Motorola. Maybe Wozniak meant that Apple has a strong vendor-client relationship with Nuance.

Fourth, Nuance is currently valued at over $5 billion. Apple has a war chest the size of the universe, so they could easily pick up the company if they wanted to, but I seriously doubt Apple would spend such a a sizeable chunk of its $50 billion+ in cash for a purchase of a publicly listed, profitable company which may seem sound on a strategic level, but could well prove to be a nightmare on an integration level.

Fifth, I simply don’t believe Wozniak would be in the loop if this acquisition was still in progress or signed very recently. He obviously still has strong ties with Apple, but it’s not like he’s part of senior management, nor is he a board member.

To conclude, I think Wozniak simply misspoke. Hey, it wouldn’t be the first time.

Unless of course he didn’t, in which case I’ll have to come back and update this post :)